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5 reasons why Generative AI is a disruptive telco catalyst

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October 04, 2023

Are telcos missing out on bigger revenue opportunities?  

The answer might be yes if the telecommunication industry fails to acknowledge and utilize the potential of Generative AI.  

So, what is Generative AI? Generative Artificial Intelligence (AI) is an AI application that can imitate human creative processes by ‘generating’ new data identical to the kind it was trained on. Essentially, it can generate images, text, and other forms of media in response to prompts given as inputs. Common examples of Generative AI are ChatGPT by OpenAI and Bard by Google.  

This new development in technology promises striking results. As per Deloitte, it is estimated by various analysts that the market for Generative AI will be valued at $200B by 2032, and according to AWS, Generative AI is expected to increase the global GDP by 7% and increase productivity growth by 1.5% over 10 years. These statistics give an overview of what Generative AI can do, and its impact extends to the telco industry.  

A revolution is underway in telecom with the emergence of generative AI, or "telco generative applications." This innovative approach leverages the combined power of artificial intelligence services and generative technologies to significantly enhance various aspects of telecommunication services and operations. As the telecom industry embraces this transformative technology, we can expect a wave of disruptive changes, fostering entirely new and efficient ways to deliver and experience communication services. Let's explore the top 5 reasons why generative AI is acting as a game-changer within the telco sector. 

    1. Improved network & capacity optimization 

Telecommunications companies are unlocking the benefits of artificial intelligence through generative AI for network optimization. By analyzing historical data, generative AI can identify patterns and predict network traffic demands. This foresight empowers telcos to optimize capacity, ensuring improved and uninterrupted services. 

Furthermore, generative machine learning models leverage historical data to anticipate potential network failures and performance issues. This proactive approach, driven by the benefits of artificial intelligence, allows telcos to perform preventive maintenance, ultimately reducing downtime and enhancing network reliability and customer satisfaction. 

   2. Enabling fraud detection  

Did you know that according to McKinsey, fraud losses for internet crimes alone sum up to $6.9 billion in the U.S. in 2021 and markets globally experience similar spikes in fraudulent activity?   

These figures represent an alarming situation, and it is the need of the hour for telco providers to improve fraud detection services.  

Generative AI is a powerful tool to curb crime rate and reduce fraud-related activities. Generative AI can be employed for analysing customer behaviour and detecting patterns indicative of fraud, enabling proactive measures to safeguard customers. By employing Generative AI, telecom companies can identify suspicious activities, such as unusual call patterns or excessive text messaging, which may signal potential fraud.   

In addition, this technology can play a crucial role in detecting activities such as hacking and spamming, by analysing network data to spot fraudulent patterns and promptly notifying operators for intervention. By leveraging Generative AI’s capabilities, telecom operators can prevent financial losses and uphold network integrity, enhancing overall customer protection and security.  

    3. Enhancing customer experience  

In a Forbes article, according to the 2022 State of Customer Churn in Telecom report, due to poor customer experience, customer loyalty to telecom providers has dramatically decreased by 22% post-pandemic.   

Thus, telco providers must invest their resources in improving customer service. Fortunately, Generative AI is here to save the day.  

Generative AI technologies like Natural Language Processing (NLP) and voice synthesis can transform customer interactions in the telecom industry. By using NLP algorithms telecom companies can create chatbots and virtual assistants capable of handling customer inquiries in real-time. These virtual agents, powered by generative language models, understand and respond to natural language queries, leading to faster and more efficient customer support. This leads to improved customer satisfaction and personalized experience for users.   

Telecom providers can also adopt IVR systems, that are integrated with Generative AI, to have human-like voice prompts and personalized scripts which are subject to change based on customer needs instead of pre-recorded messages.   

    4. Developing better marketing strategies 

Based on an IBM survey, 35% of respondents believe that Generative AI is among the most prominent emerging technologies that will significantly impact business processes, including marketing, in the coming years. This technology is expected to revolutionize automation for marketers, as it can generate content from scratch, opening new possibilities in content creation and marketing strategies.  

Generative AI is revolutionizing marketing within the telecom industry. This powerful combination of AI and technology is enabling various content creation tasks, such as social media posts, video scripts, and even SEO-optimized content with targeted keywords, all powered by deep learning algorithms and generative models. 

Leveraging this AI transformation, telecom companies can glean valuable customer insights from generative models. These insights unlock the ability to personalize marketing campaigns, tailor service offerings, and refine customer retention strategies.   

Furthermore, generative AI can automate various marketing tasks, including content creation, distribution, and performance analysis across email marketing, social media marketing, and search engine marketing efforts.   

    5. Proactive & predictive maintenance  

By using Generative AI companies can discover patterns and problematic areas previously unknown and analyse data from network equipment to identify potential problems before they occur. This can result in proper scheduling of predictive maintenance which can result in optimized network capacity and increase in reliability.  

These are just a few examples that unravel the potential that Generative AI holds in transforming the telco industry soon. By harnessing the power of this new technology, the telco industry can revolutionize and improve its operational efficiency with less investment in resources.   

To learn more, feel free to get in touch with us.   

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